For sale by owner negotiations can be interesting.  Almost everybody who tries to be a for sale by owner, or FSBO, thinks that because they sold a house ten years ago, or have sold a dozen homes over their lifetime, that all that is involved is putting up a for sale sign and the buyer will make an offer, get accepted, and close.  Not so fast, my friend.

Almost anybody can get a contract.  It is after the contract that the sale actually happens.  First the for sale by owner negotiates with the buyer.  Buyers invariably think that because a house is a for sale by owner, or FSBO, that this is a garage sale opportunity and the seller will give the house away.  Of course, the seller feels he needs to get top dollar for the house and is asking for what he feels the house is worth, often not considering what the real market value may be.  So, the initial negotiations are between the seller - thinking he will get top dollar, and the buyer - looking for the proverbial "deal" offering a garage sale price.  And if the buyer has a Realtor, which the vast majority of buyers do, that Realtor represents the best interests of her buyer, so she is not going to let the seller get anymore than absolutely necessary.  If the FSBO is unrealistic in the price of the house, a professional Realtor will simply have her buyer find another house that is priced properly and not overpay.  After all, the Realtor is trained in negotiations, and has her finger on the pulse of the market, so she knows just about exactly what the house is really worth.  So, when the for sale by owner negotiations eventually work out, a price is agreed upon and everything is just peachy, right?

Not really.  Now, the Realtor who represents the buyer is going to have inspections done.  The seller now has to negotiate with whatever the home inspector found, and they will always find something.  Not to mention what the pest inspection turns up, whether it is simple wood rot, or a major termite infestation.  These things now need the for sale by owner negotiations to work out.

And the buyer's lender might need the seller to get involved in the mortgage, depending on the loan structure.

The title company just might find an issue with title, so the for sale by owner now needs to address the title issue, which could kill the deal if not handled properly.

If you feel really good about your knowledge of the local real estate market, are confident that your house is completely maintained and has no hidden issues (roof leaking, plumbing, electrical, termites, etc.) then you can be comfortable about managing your own for sale by owner negotiations. 

For sale by owner negotiations can be good for all parties, or they can cause incredible frustration for the seller, because he can't sell the house, or the buyers will be frustrated because the seller appears to be unreasonable during the negotiations.  By the way, we didn't even talk about disclosures.  That is a topic for another time.

In the end, according to the National Association of Realtors, over 80% of real estate transactions have a professional Realtor involved.